By Bruce Watt, Ph.D.
Sometimes I feel that there is too much negativity about leaders in the media (and perhaps sadly within our HR profession). Yes, all leaders bear the burden of accountability and contend with the scrutiny and visibility that comes with the leadership territory. Despite the downside, our society needs leaders, and we should be sensitive to the fact that we are discouraging future generations from aspiring to be leaders. Our HR profession needs to be a stronger advocate for this balance between holding leaders accountable and incubating negativity. Though not a new issue, I worry about the rise in negative media articles and discussions about the leader as a bully or even a psychopath.
In the 2003 paper In Defence of the Leader, co-authored with my colleague Mark Busine, we explored the consequences of the increased scrutiny and heightened public criticism targeted at the professional impropriety, excessive remuneration, and lack of accountability for non-performance associated with company executives in Australia. We felt that the balance was tipping dangerously toward a generalised negativity for the role of leader, and that this represented a serious risk of diminishing the leadership aspirations of future generations—a consequence neither Australia nor the rest of the world can afford. Arguably, leadership is becoming more challenging within the ubiquitous themes that leaders confront—Volatility, Uncertainty, Complexity, and Ambiguity (VUCA). Our responsibility is to select and prepare better leaders, hold them accountable, and (very importantly) encourage future generations to pursue leadership.
While reflecting on the current generalised negativity directed at leaders worldwide, we felt it worthwhile to draw upon an excerpt from our 2003 article—which may be even more relevant today.
In Defence of the Leader
Excerpted from the white paper by Mark Busine and Bruce Watt, Ph.D.
How does this stand up as a blueprint for the type of business leader Australia needs?
Someone who can: build a business from $2 million to $4 billion (give or take a few hundred million) in roughly a decade; achieve this within a publicly listed institution so that the wealth is distributed to and shared with mums and dads; earn the universal respect of peers and employees not only for their business skills but also for their integrity and concern for the business culture; back up their success in business by contributing back to the community and those less fortunate; and achieve all this without controversy and in an environment of extreme complexity and accountability.
Sound impossible? Well it wasn’t for Chris Cuffe, who achieved all of the above during his tenure at the helm of Colonial First State. If you weren’t aware of Chris Cuffe’s leadership track record, it is probably because his achievements have been lost in the barrage of emotion surrounding the magnitude of his recent payout. We use this example not to defend this particular payout but to highlight an extremely dangerous sentiment toward business leadership that is potentially toxic for Australia’s future socio-economic prosperity. Increased scrutiny and heightened public criticism of alleged instances of impropriety, excessive remuneration and apparent avoidance of accountability for non-performance has created a whole new set of challenges for company executives in Australia.
The current mood of scepticism and contempt towards company executives in Australia creates a volatile and potentially dangerous business environment. Excellence in company leadership is a prerequisite for the economic growth, wealth creation and the accruement of social benefits that underpin our society. In losing sight of this simple fact, we unwittingly denigrate the role of company executive to the extent that we discourage our most talented from pursuing leadership. In an increasingly complex business environment where leaders must navigate a myriad of roles, demands, and expectations, it begs the question: “Who would want to be a leader?” Perhaps it’s time to redress the balance. If the business community and society at large is to place such high expectations on our executives then it also needs to take responsibility for preparing future leadership talent. Could it be that organisations and society at large are failing our leaders rather than our leaders failing us?
Faced with the challenges of the new environment, the pressure for companies and society to identify and develop future leaders has never been greater. So what needs to be done? First of all, organisations need to put in place practices that ensure leadership talent is identified early and provided with plenty of opportunity to grow. To achieve this, they must have an objective process to identify a pool of people that have high potential as future leaders. This should include criteria such as desire to lead; the ability to engage people; sound integrity and ethic; a strong development orientation, including receptivity to feedback and learning agility; ability to think conceptually and deal with complexity; and a passion for results. From here, it is important to undertake a comprehensive diagnosis of individual development needs aligned to the experiences, knowledge, capabilities, and personal style factors required for success in a specific leadership role. This must be followed up with specific development actions that involve on-the-job assignments, coaching, and (where appropriate) formal training. Surrounding this must be a strictly enforced governance framework of accountabilities and on-going review to ensure that development actually happens.
Australia is well known for its tall poppy syndrome. While a healthy level of scepticism is core to our well-grounded and egalitarian values, this must be balanced with a realisation and understanding that, going forward, successful leadership is pivotal to Australia’s well-being. A more balanced approach is required for the assessment of company performance that focuses not only on short-term gains but also on longer-term sustainability. As Collins and Porras asked in their acclaimed study of organizations (Built to Last, 1996), are we building companies and company executives for the future or for today? Finally, we must view leadership as a responsibility of everyone, not just the company executive.
In the end, should we feel sympathy for company executives in the task ahead? No, but are we doing enough to encourage and support the next generation of company executives? We think not.
Read the full white paper, In Defence of the Leader.
Bruce Watt, Ph.D., is managing director, DDI Australia.